RPG mulling pvt equity to part fund Rs 2,000 cr retail capex

MUMBAI: The RPG Group may tap private equity to fund the expansion of its Spencer's retail business in which Rs 2,000-crore is to be pumped in over the next two-years.

"We have earmarked an investment of Rs 2,000-crore for Spencer's over the next two-years. We might look at private equity funding to raise some funds," RPG Group Chairman, Harsh Goenka, told media.

The group's focus will be on large-format stores and strategic tie-ups," Goenka said.

"While much of the capital would be generated through internal accruals, we might also consider private equity funding," the RPG chief said.

The private equity route would, however, be tapped only after the markets stabilised to get better valuations, he said.

By March 2009, the group will have 400-plus stores of which 40 will be large-format stores. "Over the next two-years, we plan to add 400 more Spencer's stores at an investment of Rs 2,000-crore," Goenka said.

The targeted turnover for FY 09 is Rs 1,250-crore, he said.

As part of its strategic tie-up plans, the group will join hands with US-based fast-casual dining-chain, Au Bon Pain, which has 200 outlets in the US.

The first of these outlets would be launched in Bangalore by mid-2009. "Our plan is to have a 200-strong stand-alone network in the country in the next two-years," Goenka said.